Listings
How a new listing works.
When a company lists on the stock exchange, it first offers its shares to investors at a set price, before trading begins. Taking part at that stage means applying through a firm with a place in the offer. Here is how the process works, and how Towemer Wealth can help you take part. This page is general information, not an offer or a recommendation.
How the offer price is set.
During the offer, investors place orders at each price in a published range. Demand falls as the price rises, and the final price is usually set where there is still more demand than there are shares on offer.
Illustrative figures only, not a real offer. Cover is the demand at each price, as a multiple of the shares on offer. The final price is set where demand still covers the shares on offer.
Four stages, and when you can take part.
Select a stage to see what happens and whether you can take part.
Can you take part?
Intention to float
The full timeline.
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Week 0
Mandate
The company appoints its advisers and sets the timetable. Decisions on the size and structure of the offer are made here.
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Weeks 1 to 13
Preparation
The accounts are prepared to listing standard, the board is strengthened, and governance is brought up to what the market expects.
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Week 14
Intention to float
The public announcement that a listing is coming, typically four to six weeks before the shares are admitted. Investors can start reading about the company.
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Week 17
Prospectus
The offer document: what the company does, its finances, how the money raised will be used, and the risks. The risk factors section is one of the most useful parts to read.
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Weeks 19 to 21
Roadshow and book-build
The company presents to investors, a price range is published, and orders are collected. Demand at that range is one of the main inputs to the final price.
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Week 21
Pricing and allocation
The final price is set and shares are allocated by the banks running the offer. In a popular offer, applications are scaled back.
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Week 22
First day of trading
The shares begin trading on the exchange. The price on the first day reflects demand that day, and can be above or below the offer price.
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Week 26
Stabilisation ends
For up to thirty days after listing, a stabilising manager may buy shares to support an orderly market. After that, the price is set by trading alone.
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Months 12 to 24
Escrow ends
Shares held by founders and early investors are often restricted from sale for twelve or twenty four months, under ASX escrow rules or a voluntary agreement. The end dates are in the prospectus, so they are known in advance.
Good to know.
Read the prospectus
The prospectus sets out the business, its finances and its risks. The risk factors section is worth reading in full, and your adviser can take you through it.
Look beyond the first day
A strong first day shows demand for the shares on that day. The value of the business is a longer term question, and it is the one your adviser looks at.
Check the free float
The share of the company available to trade affects how easily you can buy and sell. A smaller free float can mean larger price moves.
Note the escrow dates
When restrictions on early shareholders end, more shares can come up for sale. The dates are in the prospectus, so you can plan around them.
Keep it in proportion
A new listing usually works best as a smaller part of a wider portfolio, alongside your deposits, bonds and funds.
How we help.
When an offer is open
When the firm has a place in an offer, it appears in your account under Offerings, with the prospectus, the reasons and the closing date.
At the offer price
Your adviser arranges your application while the offer is open, so you take part at the offer price, before trading begins.
Allocations
In a popular offer, applications are scaled back. You learn your allocation when the price is set, and it can be less than you applied for.
Part of your wider portfolio
Your adviser considers a new listing alongside the deposits, bonds and funds you already hold, so it fits with the rest of your portfolio.
Charged on the gain
A listing is charged on the gain when you sell, not on the amount you invest, and there is no fee if there is no gain. The rates are in our Financial Services Guide.
Talk to an adviser.
Tell us what you would like your money to do, and an adviser will take you through your options. There is no obligation.